Source: Microinsurance next frontier for financial inclusion — IPEC – herald
Tapiwanashe Mangwiro
Senior Business Reporter
THE insurance regulator is betting on microinsurance and financial technology to pull millions of young people and informal sector workers into the formal financial system, arguing that traditional insurance models have failed to meet the realities of the country’s economy.
Speaking at the Global Money Week 2026 CEO Roundtable in Harare last week, Insurance and Pensions Commission of Zimbabwe manager for insurance Mr Honest Kwashi said more than 70 percent of Zimbabweans remain uninsured despite the economy’s growing exposure to climate, health and business risks.
Presenting under the theme “Leveraging Microinsurance Products to Increase Uptake of Insurance”, Mr Kwashi said Zimbabwe’s financial exclusion challenge was particularly acute among young people and informal businesses, which now dominate the economy.
According to the presentation, the informal sector contributes about 76 percent of gross domestic product while insurance penetration remains at just 1,6 percent, with more than 60 percent of Zimbabwe’s population aged below 35.
“Microinsurance is accessible, affordable protection for low-income households, characterised by low premiums, simple products, fast claims and digital distribution,” Mr Kwashi said.
“It is not charity; it is smart regulation meeting real demand.”
The presentation framed insurance exclusion not merely as a market failure but as a social vulnerability affecting rural households, young entrepreneurs and small-scale farmers already exposed to economic shocks and climate volatility.
Using the example of a rural widow, the presentation highlighted how one failed agricultural season could wipe out school fees, medicine access and household food security for families without insurance cover.
By contrast, another case study presented at the roundtable showed how a young poultry entrepreneur recovered after an insurer settled his claim within three days following a disease outbreak that destroyed his flock.
“Risks do not care about your age or your dreams,” the presentation noted.
Mr Kwashi said the biggest barriers to insurance uptake included unaffordable premiums, limited rural access, lengthy paperwork and low financial literacy.
However, he argued that technology was beginning to change the economics of insurance distribution in Zimbabwe.
The presentation identified mobile money platforms, artificial intelligence, USSD services and parametric insurance as key tools capable of reaching underserved communities at scale. Zimbabwe’s mobile penetration currently stands at about 95 percent, according to the presentation.
“USSD codes, mobile apps and agent networks eliminate geographic barriers,” Mr Kwashi said.
“Insurance reaches remote communities where no office or agent has ever existed.”
The regulator also pointed to increasing use of satellite imagery and weather-based insurance products that allow automatic payouts without lengthy claims assessments.
In a sign of growing regulatory support for financial innovation, IPEC said Zimbabwe now has 16 licenced microinsurers and recorded 81 percent profit growth among microinsurers during 2025.
The commission also officially launched its regulatory sandbox framework on May 15 this year to allow InsurTech companies to test new products under supervised conditions.
“There is a massive opportunity in solving these problems, and IPEC’s Sandbox is the launchpad,” Mr Kwashi said.
The regulator is now pushing for broader integration of microinsurance into agriculture, education financing and Government social protection programmes.
Under proposals outlined during the presentation, IPEC wants insurance products embedded into input subsidy schemes, student loans and digital financial services ecosystems.
The commission also proposed a shared regulatory sandbox involving the Reserve Bank of Zimbabwe, POTRAZ, the Securities and Exchange Commission and the Data Protection Authority to support cross-sector financial innovation.
“Every Zimbabwean, young or old, urban or rural, deserves financial protection,” the presentation concluded.
“Microinsurance is not a niche. It is the bridge.”
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